History of Georgia

THE THREE REPUBLICS of Transcaucasia--Armenia, Azerbaijan, and Georgia--were included
in the Soviet Union in the early 1920s after their inhabitants had passed through long and
varied periods as separate nations and as parts of neighboring empires, most recently the
Russian Empire. By the time the Soviet Union dissolved at the end of 1991, the three
republics had regained their independence, but their economic weakness and the turmoil
surrounding them jeopardized that independence almost immediately. By 1994 Russia had
regained substantial influence in the region by arbitrating disputes and by judiciously
inserting peacekeeping troops. Geographically isolated, the three nations gained some
Western economic support in the early 1990s, but in 1994 the leaders of all three asserted
that national survival depended chiefly on diverting resources from military applications
to restructuring economic and social institutions.

Location at the meeting point of
southeastern Europe with the western border of Asia greatly influenced the histories of
the three national groups forming the present-day Transcaucasian republics. Especially
between the twelfth and the twentieth centuries, their peoples were subject to invasion
and control by the Ottoman, Persian, and Russian empires. But, with the formation of the
twentieth-century states named for them, the Armenian, Azerbaijani, and Georgian peoples
as a whole underwent different degrees of displacement and played quite different roles.
For example, the Republic of Azerbaijan that emerged from the Soviet Union in 1991
contains only 5.8 million of the world's estimated 19 million Azerbaijanis, with most of
the balance living in Iran across a southern border fixed when Persia and Russia in the
nineteenth century. At the same time, slightly more than half the world's 6.3 million
Armenians are widely scattered outside the borders of the Republic of Armenia as a result
of a centuries-long diaspora and step-by-step reduction of their national territory. In
contrast, the great majority of the world's Georgian population lives in the Republic of
Georgia (together with ethnic minorities constituting about 30 percent of the republic's
population), after having experienced centuries of foreign domination but little forcible
alteration of national boundaries.

The starting points and the outside influences that formed the three cultures also were
quite different. In pre-Christian times, Georgia's location along the Black Sea opened it
to cultural influence from Greece. During the same period, Armenia was settled by tribes
from southeastern Europe, and Azerbaijan was settled by Asiatic Medes, Persians, and
Scythians. In Azerbaijan, Persian cultural influence dominated in the formative period of
the first millennium B.C. In the early fourth century, kings of Armenia and Georgia
accepted Christianity after extensive contact with the proselytizing early Christians at
the eastern end of the Mediterranean. Following their conversion, Georgians remained tied
by religion to the Roman Empire and later the Byzantine Empire centered at Constantinople.
Although Armenian Christianity broke with Byzantine Orthodoxy very early, Byzantine
occupation of Armenian territory enhanced the influence of Greek culture on Armenians in
the Middle Ages.

In Azerbaijan, the Zoroastrian religion, a legacy of the early Persian influence there,
was supplanted in the seventh century by the Muslim faith introduced by conquering Arabs.
Conquest and occupation by the Turks added centuries of Turkic influence, which remains a
primary element of secular Azerbaijani culture, notably in language and the arts. In the
twentieth century, Islam remains the prevalent religion of Azerbaijan, with about
three-quarters of the population adhering to the Shia branch.

Golden ages of peace and independence enabled the three civilizations to individualize
their forms of art and literature before 1300, and all have retained unique
characteristics that arose during those eras. The Armenian, Azerbaijani, and Georgian
languages also grew in different directions: Armenian developed from a combination of
Indo-European and non-Indo-European language stock, with an alphabet based on the Greek;
Azerbaijani, akin to Turkish and originating in Central Asia, now uses the Roman alphabet
after periods of official usage of the Arabic and Cyrillic alphabets; and Georgian,
unrelated to any major world language, use a Greek-based alphabet quite different from the
Armenian.

Beginning in the eighteenth century, the Russian Empire constantly probed the Caucasus
region for possible expansion toward the Black Sea and the Caspian Sea. These efforts
engaged Russia in a series of wars with the Persian and Ottoman empires, both of which by
that time were decaying from within. By 1828 Russia had annexed or had been awarded by
treaty all of present- day Azerbaijan and Georgia and most of present-day Armenia. (At
that time, much of the Armenian population remained across the border in the Ottoman
Empire.)

Except for about two years of unstable independence following World War I, the
Transcaucasus countries remained under Russian, and later Soviet, control until 1991. As
part of the Soviet Union from 1922 to 1991, they underwent approximately the same degree
of economic and political regimentation as the other constituent republics of the union
(until 1936 the Transcaucasian Soviet Federated Socialist Republic included all three
countries). The Sovietization process included intensive industrialization,
collectivization of agriculture, and large-scale shifts of the rural work force to
industrial centers, as well as expanded and standardized systems for education, health
care, and social welfare. Although industries came under uniform state direction, private
farms in the three republics, especially in Georgia, remained important agriculturally
because of the inefficiency of collective farms.

The achievement of independence in 1991 left the three republics with inefficient and
often crumbling remains of the Soviet-era state systems. In the years that followed,
political, military, and financial chaos prevented reforms from being implemented in most
areas. Land redistribution proceeded rapidly in Armenia and Georgia, although agricultural
inputs often remained under state control. In contrast, in 1994 Azerbaijan still depended
mainly on collective farms. Education and health institutions remained substantially the
same centralized suppliers as they had in the Soviet era, but availability of educational
and medical materials and personnel dropped sharply after 1991. The military conflict in
Azerbaijan's Nagorno- Karabakh Autonomous Region put enormous stress on the health and
social welfare systems of combatants Armenia and Azerbaijan, and Azerbaijan's blockade of
Armenia, which began in 1989, caused acute shortages of all types of materials.

The relationship of Russia to the former Soviet republics in the Transcaucasus caused
increasing international concern in the transition years. The presence of Russian
peacekeeping troops between Georgian and Abkhazian separatist forces remained an
irritation to Georgian nationalists and an indication that Russia intended to intervene in
that part of the world when opportunities arose. Russian nationalists saw such
intervention as an opportunity to recapture nearby parts of the old Russian, and later
Soviet empire. In the fall of 1994, in spite of strong nationalist resistance in each of
the Transcaucasus countries, Russia was poised to improve its economic and military
influence in Armenia and Azerbaijan, as it had in Georgia, if its mediation activities in
Nagorno-Karabakh bore fruit.

The countries of Transcaucasia each inherited large state- owned enterprises
specializing in products assigned by the Soviet system: military electronics and chemicals
in Armenia, petroleum- based and textile industries in Azerbaijan, and chemicals, machine
tools, and metallurgy in Georgia. As in most of the nations in the former Soviet sphere,
redistribution and revitalization of such enterprises proved a formidable obstacle to
economic growth and foreign investment in Armenia, Azerbaijan, and Georgia. Efforts at
enterprise privatization were hindered by the stresses of prolonged military engagements,
the staying power of underground economies that had defied control under communist and
governments, the lack of commercial expertise, and the lack of a legal infrastructure on
which to base new business relationships. As a result, in 1994 the governments were left
with oversized, inefficient, and often bankrupt heavy industries whose operation was vital
to provide jobs and to revive the national economies. At the same time, small private
enterprises were growing rapidly, especially in Armenia and Georgia.

In the early 1990s, the Caucasus took its place among the regions of the world having
violent post-Cold War ethnic conflict. Several wars broke out in the region once Soviet
authority ceased holding the lid on disagreements that had been fermenting for decades.
(Joseph V. Stalin's forcible relocation of ethnic groups after the redrawing of the
region's political map was a chief source of the friction of the 1990s.) Thus, the three
republics devoted critical resources to military campaigns in a period when the need for
internal restructuring was paramount.

In Georgia, minority separatist movements--primarily on the part of the Ossetians and
the Abkhaz, both given intermittent encouragement by the Soviet regime over the
years--demanded fuller recognition in the new order of the early 1990s. Asserting its
newly gained national prerogatives, Georgia responded with military attempts to restrain
separatism forcibly. A year-long battle in South Ossetia, initiated by Zviad Gamsakhurdia,
post- Soviet Georgia's ultranationalist first president, reached an uneasy peace in
mid-1992. Early in 1992, however, the violent eviction of Gamsakhurdia from the presidency
added another opponent of Georgian unity as the exiled Gamsakhurdia gathered his forces
across the border.

In mid-1992 Georgian paramilitary troops entered the Abkhazian Autonomous Republic of
Georgia, beginning a new conflict that in 1993 threatened to break apart the country. When
Georgian troops were driven from Abkhazia in September 1993, Georgia's President Eduard
Shevardnadze was able to gain Russian military aid to prevent the collapse of the country.
In mid-1994 an uneasy cease-fire was in force; Abkhazian forces controlled their entire
region, but no negotiated settlement had been reached. Life in Georgia had stabilized, but
no permanent answers had been found to ethnic claims and counterclaims.

For Armenia and Azerbaijan, the center of nationalist self- expression in this period
was the Nagorno-Karabakh Autonomous Region of Azerbaijan. After the Armenian majority
there declared unification with Armenia in 1988, ethnic conflict broke out in both
republics, leaving many Armenians and Azerbaijanis dead. For the next six years, battles
raged between Armenian and Azerbaijani regular forces and between Armenian militias from
Nagorno-Karabakh ("mountainous Karabakh" in Russian), and foreign mercenaries,
killing thousands in and around Karabakh and causing massive refugee movements in both
directions. Armenian military forces, better supplied and better organized, generally
gained ground in the conflict, but the sides were evened as Armenia itself was devastated
by six years of Azerbaijani blockades. In 1993 and early 1994, international mediation
efforts were stymied by the intransigence of the two sides and by competition between
Russia and the Conference on Security and Cooperation in Europe for the role of chief
peace negotiator.

GEORGIA

Georgia possesses the advantages of a subtropical Black Sea coastline and a rich
mixture of Western and Eastern cultural elements. A combination of topographical and
national idiosyncracies has preserved that cultural blend, whose chief impetus was the
Georgian golden age of the twelfth and early thirteenth centuries, during long periods of
occupation by foreign empires. Perhaps the most vivid result of this cultural independence
is the Georgian language, unrelated to any other major tongue and largely unaffected by
the languages of conquering peoples--at least until the massive influx of technical
loanwords at the end of the twentieth century.

Since independence, Georgia has had difficulty establishing solid political
institutions. This difficulty has been caused by the distractions of continuing military
crises and by the chronic indecision of policy makers about the country's proper long-term
goals and the strategy to reach them. Also, like the other Transcaucasus states, Georgia
lacks experience with the democratic institutions that are now its political ideal;
rubber- stamp passage of Moscow's agenda is quite different from creation of a legislative
program useful to an emerging nation.

As in Azerbaijan, Georgia's most pressing problem has been ethnic separatism within the
country's borders. Despite Georgia's modest size, throughout history all manifestations of
a Georgian nation have included ethnic minorities that have conflicted with, or simply
ignored, central power. Even in the golden age, when a central ruling power commanded the
most widespread loyalty, King David the Builder was called "King of the Abkhaz, the
Kartvelians, the Ran, the Kakhetians, and the Armenians." In the twentieth century,
arbitrary rearrangement of ethnic boundaries by the Soviet regime resulted in the
sharpening of various nationalist claims after Soviet power finally disappeared. Thus, in
1991 the South Ossetians of Georgia demanded union with the Ossetians across the Russian
border, and in 1992 the Abkhaz of Georgia demanded recognition as an independent nation,
despite their minority status in the region of Georgia they inhabited.

As in Armenia and Azerbaijan, influential, intensely nationalist factions pushed hard
for unqualified military success in the struggle for separatist territory. And, as in the
other Transcaucasus nations, those factions were frustrated by military and geopolitical
reality: in Georgia's case, an ineffective Georgian army required assistance from Russia,
the imperialist neighbor against whom nationalists had sharpened their teeth only three
years earlier, to save the nation from fragmentation. At the end of 1993, Russia seemingly
had settled into a long-term role of peacekeeping and occupation between Georgian and
Abkhazian forces.

The most unsettling internal crisis was the failed presidency of Zviad Gamsakhurdia,
once a respected human rights advocate and the undisputed leader of Georgia's nationalist
opposition as the collapse of the Soviet Union became imminent. In 1991 Gamsakhurdia's
dictatorial and paranoid regime, followed by the bloody process of unseating him, gave
Georgia a lasting reputation for instability that damaged prospects for foreign investment
and for participation in international organizations.

The failure of the one-year Gamsakhurdia regime necessitated a new political beginning
that coincided with the establishment of Eduard Shevardnadze as head of state in early
1992. Easily the most popular politician in Georgia and facing chronically fragmented
opposition in parliament, Shevardnadze acquired substantial "temporary"
executive powers as he maneuvered to maintain national unity. At the same time, his
hesitation to imitate Gamsakhurdia's grab for power often left a vacuum that was filled by
quarreling splinter parties with widely varied agendas. Shevardnadze preserved parts of
his reform program by forming temporary coalitions that dissolved when a contentious issue
appeared. Despite numerous calls for his resignation, and despite rampant government
corruption and frequent shifts in his cabinet between 1992 and 1994, there were no other
serious contenders for Shevardnadze's position as of late 1994.

Shevardnadze also used familiarity with the world of diplomacy to reestablish
international contacts, gain sympathy for Georgia's struggle to remain unified, and seek
economic ties wherever they might be available. Unlike Armenia and Azerbaijan, Georgia did
not arouse particular loyalty or hostility among any group of nations. In the first years
of independence, Shevardnadze made special overtures to Russia, Turkey, and the United
States and attempted to balance Georgia's approach to Armenia and Azerbaijan, its feuding
neighbors in the Transcaucasus.

The collapse of the Soviet Union changed Georgia's economic position significantly,
although industrial production already was declining in the last Soviet years. In the
Soviet system, Georgia's assignment was mainly to supply the union with agricultural
products, metal products, and the foreign currency collected by Georgian tourist
attractions. This specialization made Georgia dependent on other Soviet republics for a
wide range of products that were unavailable after 1991. Neither diversification nor
meaningful privatization was possible, however, under the constant upheaval and energy
shortages of the early 1990s. In addition, powerful organized criminal groups gained
control of large segments of the national economy, including the export trade.

After the January 1992 fall of Gamsakhurdia's xenophobic regime, the maintenance of
internal peace and unity was a critical national security issue. Although some progress
was made in establishing a national armed force in 1994 the paramilitary
organizations--the Mkhedrioni (horsemen) and the National Guard-- remained influential
military forces in the fall of 1994. The small size and the poor organization of those
groups had forced the request for Russian troop assistance in late 1993, which in turn
renewed the national security dilemma of occupation by foreign troops. Meanwhile, civilian
internal security forces, of which Shevardnadze took personal control in 1993, gained only
partial victories over the crime wave that accompanied Georgia's post-Soviet upheavals. A
series of reorganizations in security agencies failed to improve the protection of
individuals against random crime or of the economic system against organized groups.

Through most of 1994, the Abkhazian conflict was more diplomatic than military. In
spite of periodic hostilities, the uneasy truce line held along the Inguri River in far
northwestern Georgia (in the campaign of October 1993, Georgian forces had been pushed out
of all of Abkhazia except the far northern corner). The role of the 3,000 Russian
peacekeepers on the border, and their relationship with United Nations (UN) observers, was
recognized by a resolution of the UN Security Council in July. Throughout that period, the
issue of the return of as many as 300,000 Georgian refugees to Abkhazia was the main
sticking point of negotiations. The Abkhaz saw the influx of so many Georgians as a danger
to their sovereignty, which Georgia did not recognize, and the refugees' plight as a
bargaining chip to induce further Georgian withdrawal. No settlement was likely before the
refugee issue was resolved. Meanwhile, supporting the refugees placed additional stress on
Georgian society.

A legal basis for the presence of Russian troops in Georgia had been established in a
status-of-forces treaty between the two nations in January 1994. The treaty prescribed the
authority and operating conditions of the Group of Russian Troops in the Caucasus (GRTC),
which was characterized as on Georgian territory for a "transitional period." In
the summer of 1994, high-level bilateral talks covered Georgian-Russian military
cooperation and further integration of CIS forces.

The Georgian economy continued to struggle in 1994, showing only isolated signs of
progress. At the beginning of the year, state monopolies were reaffirmed in vital
industries such as tea and food processing and electric power. By May, however, after
prodding from the IMF, Shevardnadze began issuing decrees that eased privatization
conditions. This policy spurred a noticeable acceleration of privatization in the summer
of 1994. When the new stimulus began, about 23 percent of state enterprises had been
privatized, and only thirty-nine joint-stock companies had formed out of the more than 900
large firms designated for that type of conversion. A voucher system for collecting
private investment funds, delayed by a shortage of hard currency, finally began operating.
But the state economic bureaucracy, entrenched since the Soviet era, was able to slow the
privatization process when dispersal of economic power threatened its privileged position
in 1994.

Between mid-1993 and mid-1994, prices rose by an average of 300 percent, and inflation
severely eroded the government- guaranteed minimum wage. (In August the minimum wage,
which was stipulated in coupons, equaled US$0.33 per month.) Often wages were withheld for
months because of the currency shortage. In September the government raised price
standards sharply for basic food items, transportation, fuel, and services. Lump-sum
payments to all citizens, designed to offset this cost, failed to reach many, prompting
new calls for Shevardnadze's resignation. Under those conditions, most Georgians were
supported by a vast network of unofficial economic activities.

In mid-1994 unemployment was estimated unofficially at 1.5 million people, nearly 50
percent of Georgia's working-age population. The exchange rate of the Georgian coupon
stabilized in early 1994 after many months of high inflation, but by that time the coupon
had been virtually displaced in private transactions by the ruble and the dollar. The
national financial system remained chaotic--especially in tax collection, customs, and
import-export operations. The first major state bank was privatized in the summer of 1994.
In August parliament approved a major reform program for social welfare, pricing, and the
financial system.

In July 1994, a Georgian-Russian conference on economic cooperation
discussed transnational corporations and concluded some contracts for joint
economic activities, but most Russian investors demanded stronger legal
guarantees for their risks. Numerous Western firms established small joint
ventures in 1994, but the most critical investment project under discussion
sought to exploit the substantial oil deposits that had been located by
recent Australian, British, Georgian, and United
States explorations in the Black Sea shelf near Batumi and Poti. A first
step in foreign involvement, an oil refinery near Tbilisi, received funding
in July, but the Western firms demanded major reform of commercial
legislation before expanding their participation.

Georgia experienced a major energy crisis in the winter of 1993-94; following the
crisis, in mid-1994 Turkmenistan drastically reduced natural gas supplies because of
unpaid debts. Some fuel aid was expected for the winter of 1994-95 from Azerbaijan, the
EU, Iran, and Turkey. The output of the domestic oil industry increased sharply in
mid-1994. As winter approached, Georgia also offered Turkmenistan new assurances of
payment in return for resumption of natural gas delivery.

Georgia's communications system, a chronically weak infrastructure link that also had
discouraged foreign investment, began integration into world systems in early 1994 when
the country joined international postal, satellite, and electronic communications
organizations. Joint enterprises with Australian, French, German, Turkish, and United
States communications companies allowed the upgrading of the national telephone system and
installation of fiber-optic cables.

In the first half of 1994, the most frequent topic of government debate was the role of
Russian troops in Abkhazia. By that time, opposition nationalist parties had accepted the
Russian presence but rejected Abkhazian delays in allowing the return of refugees and
Shevardnadze's tolerance of those delays. In May Shevardnadze overcame parliament's
objections to new concessions to the Abkhaz by threatening to resign. The new agreement
passed, and opposition leaders muted their demands for Shevardnadze's ouster in the belief
that Russia was seeking to replace him with someone more favorable to Russian
intervention. Nevertheless, in the fall of 1994 few Georgian refugees had returned to
Abkhazia.

Shevardnadze's exercise of extraordinary executive powers remained a hot issue in
parliament. One faction called for reduced powers in the name of democracy, but another
claimed that a still stronger executive was needed to enforce order. In a July poll, 48
percent of respondents said the government was obstructing the mass media. Although the
1992 state of emergency continued to restrict dissemination of information, the Georgian
media consistently presented various opposition views. Likewise, the Zviadists,
Gamsakhurdia's supporters, although banned from radio and television, continued to hold
rallies under the leadership of a young radical, Irakli Tsereteli.

In 1994 the government took steps to improve the internal security situation. In the
latest of a long series of organizational and leadership shuffles, Shevardnadze replaced
the Emergency Committee, which had been headed by former Mkhedrioni leader Jaba Ioseliani,
with the Emergency Coordinating Commission, headed by Shevardnadze, and gave the
commission a vague mandate to coordinate economic, political, defense, and law-enforcement
matters. Ioseliani, whose command of the Mkhedrioni still gave him great influence, became
a deputy head of the commission.

Shevardnadze's attempt to form a new, one-battalion Georgian army was delayed
throughout the first half of 1994. The Ministry of Defense continued drafting potential
soldiers (a very high percentage of whom evaded recruitment) for the Georgian armed forces
and streamlining its organization. In September the national budget had not yet allocated
wages, and sources of rations and equipment had not been identified--mainly because
parliament had not passed the necessary legislation. Ministry of Defense plans called for
the country's remaining state farms to be designated for direct military supply, as was
the practice in the Soviet era. The disposition of existing paramilitary forces remained
undecided as of late 1994.

The intelligence service had been reorganized in late 1993 to include elite troops
mandated to fight drug smuggling and organized crime. In the spring of 1994, new agencies
were formed in the State Security Service to investigate fiscal crimes and to combat
terrorism. And in August 1994, the Ministry of Internal Affairs announced a major new
drive against organized crime and drug traffickers throughout Georgia. Parliament and
local jurisdictions offered indifferent support, however.

In 1994 Georgia began solving some of its most critical problems--laying a political
base for a market economy, solidifying to a degree Shevardnadze's position as head of
state, stabilizing inflation, and avoiding large-scale military conflict. But long-term
stability will depend on comprehensive reform of the entire economy, eradication of the
corruption that has pervaded both government and economic institutions, redirection of
resources from the Abkhazian conflict into a civilian infrastructure suitable for
international trade (and for major loans from international lenders), and, ultimately,
finding political leaders besides Shevardnadze who are capable of focusing Georgians'
attention on building a nation, rather than on advancing local interests. All those
factors will influence the other major imponderable: Russia's long-term economic and
political influence in Georgia, which increased greatly in late 1993 and in the first half
of 1994. October 18, 1994